Refer to number $1$ abovo. Based on an amerage cost of captal for a capital budget is $$4,000,000,$ and the optmai capital structure is $45\%$ debi and $55\%$ equity.

a$.$ Caiculate the marginal cost of capital

b$.$ Caiculate the awerage cost of capital

Reter to number $1$ above. Marragement decldes that it can minimae the cost of capital by changing its capital scructure $mx$ to $50\%$ Debt and $50\%$ Equiny.

a$.$ With this new mix calculate the marginal cost of capitai for $$2,800,000$ or leas

b$.$ With this new mix calculate the marginal cost of capital for more than $$2,800,000.$

c$.$ Calculate the average $c08t$ of $$3,500,000$ in captal

Suppose Robotics inc. has an optimal caphal structure moc of Debt $60$ and Equity $40$

$Kd=1-(1-$taxrate$)=10\%$

Kre $=15\%,D=$$$2,$ Price of Common Stock $=$$$20$ and $g=5\%$

KCS $=17\mathrm{.}5\%$ The investment banker was $$4$ per share to tloat this risky stock.

Robatics thinks it will have incremental retained eamings of $$4,000,000$ to finance new capital investment propceals.

a$.$ Calculate the marginal cost of capital for a budget less than $$10,000,000,$

b$.$ Calculate the marginal cost of capital for a budget greater than $$10,000,000.$

e$.$ Calculate the average cost of capital for $$16,000,000.$

$5.$ Refer to $144$ above. Change the mix to $\mathrm{.}5$ Debt, $5$ Equity

a$.$ Calculate the marginal cost of capital for less than $$8,000,000.$

b$.$ Calculate the marginal cost of capital for more than $$10,000,000$

c$.$ Calculate the average cost of $$16,000,000.$